Passage of Michigan Proposal Hinders Racing

Michigan voters effectively sounded the death knell for racinos in the state when they passed the anti-gambling Proposal 1 by a 58%-42% margin with 98% of precincts reporting.

Proposal 1 requires statewide and local voter approval of any expansion of gambling in the state. A statewide vote to put video lottery terminals at racetracks is highly improbable after the multimillion-dollar ad campaign sponsored by existing casinos and targeting the prospect of "racetrack casinos" easily prevailed.

An anti-Proposal 1 coalition, led by Democratic Michigan Gov. Jennifer Granholm and Republican Oakland County Executive L. Brooks Patterson, countered with an ad campaign of its own. It claimed Proposal 1 threatened the state lottery, which last year contributed more than $600 million to public education.

Both houses of the Michigan legislature passed bills to legalize racinos this year. The bills remain in conference committee, but the Nov. 2 vote renders that legislation moot.

Polls showed significant movement toward passage of Proposal 1 in the weeks leading up to the election, but the odd-bedfellow coalition of the existing casinos and church-based anti-gambling interests easily prevailed.

On Oct. 31, Patterson told viewers of "Spotlight on the News," a weekly Detroit television news show, that the failure of Proposal 1 threatens the future of Hazel Park, the suburban Detroit Standardbred track that is the state's largest. Hazel Park heavily backed the campaign to defeat Proposal 1, but racing officials have said the track would stay in business no matter what the outcome.

Ten applications for a state Thoroughbred license remain on the desk of state racing commissioner Robert Geake. A flurry of applicants was fueled by the prospect of racinos. With the passage of Proposal 1, most are no longer considered serious applicants. But Magna Entertainment Corp., which proposes to build a multi-breed racetrack in the Detroit suburb of Romulus, has said the fate of racinos wouldn't affect its plans.

Michigan racing has been in a downward spiral for more than three decades. In 1971, attendance at Michigan tracks peaked at 3.9 million. Since then, attendance has fallen by two-thirds to 1.3 million last year. Proposal 1 could be a final nail in the coffin for many of the state's horsemen and its smaller tracks.